The Competition Commission has found that the private healthcare market in South Africa is characterised by high and rising costs of healthcare and medical scheme cover. The commission has identified features within the private healthcare market that prevents and restricts competition.

The commission asserts that a more competitive private healthcare market will translate into lower costs.

Professor Sharon Fonn of the Competition Commission’s Healthcare Market Inquiry says there is massive utilisation of healthcare facilities yet consumers have no idea what they are paying for. She was briefing the media in Sandton, north of Johannesburg.

“So what do we see in this market; high rising costs. The big thing that we found, using some really good evidence and a lot of analysis; massive utilisation in this market, admissions to hospital when you don’t need it, extra test when you don’t need it, massive over utilisation in the private healthcare sector.”

Professor Fonn says there is no method to measure the outcomes and quality of private healthcare. She says it is impossible for patients to choose healthcare based on value or pricing.

The commission found that healthcare practitioners are also subjected to little regulation. Fonn says the Health Market Inquiry seeks to create an environment in which the National Health Insurance (NHI) can function.

“No evidence of concomitant improved health outcomes. There’s nothing wrong with spending more and having more texts, as long as it results in improved outcomes and that’s what we don’t know. The market is failing and has failed in many aspects and it’s failing consumers; it’s failing me and you. It’s failing us as scheme members.”

The Competition Commission has recommended the establishment of a Supply-Side Health Regulator (SSHR) to monitor and assess the economic value and price of health services. That’s according to Dr Cees van Gent of the Commission’s Health Market Inquiry.

The commission further recommends that healthcare service prices be reviewed every three years.

Gent said the establishment of the SSRH would support the National Health Insurance Bill.

“One of our main recommendations I think is the establishment of a supply side regulator, which is badly failing in South Africa. Which, by the way, would also benefit the NHI because the NHI would contract private facility groups and needs a disciplined sector and outer sector that is left on its own. Supply side sector which will establish a clearly needs-based licensing system.”

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